The present invention relates to a method for providing funds, as an advance against proposed charges, using a card known as a smart card that contains identification and other information in order to eliminate fraud on insurance companies.
Physicians have traditionally had to wait long periods of time to get paid for their medical services. Physicians, physical therapists and others have been required to extend credit to individuals with insurance in order to get paid. This situation has become tedious and caused health care costs to be very high.
Pharmacists have had the use of automated services, such as the TelePAID system. The TelePAID system offered by PAID prescriptions LLC is a system that uses a plastic card that contains only a group number. A pharmacist, in turn, manually enters the group number, member number, and prescription information, in as attempt to give the card holder the lowest customer price into the system. The pharmacist then provides the customer with the prescription and collects the approved amount from the TelePAID system. The customer is given a receipt including authorization number. This system has the insured paying for the balance. A need has long existed for a system, wherein the insurer advances funds so that the insured does not have to handle money.
This need has been particularly great for incapacitated individuals, such as those in nursing homes, who are no longer able to handle funds or complicated transactions.
The cost of health care continues to increase as the health care industry becomes more complex, specialized, and sophisticated. The proportion of the gross domestic product that is accounted for by health care is expected to gradually increase over the coming years as the population ages and new medical procedures become available.
Over the years, the delivery of health care services is not only from individual physicians but also from large managed health maintenance organizations, hospitals, pharmacists, mental health therapists, and pharmacists. There are growing numbers of medical, dental, and pharmaceutical specialists in a complex variety of health care options and programs to service the increasing populations, which has increased in elderly populations.
Unfortunately, the payment for the delivered health care is now occurring much later than the delivery of the service. Increasingly, health care providers are acting as credit institutions for the insured because of the lack of insurers to timely provide funds under a policy.
The cost of supporting patient costs has increased during recent years, thereby contributing to today""s costly health care system. A significant portion of the increase in the cost of medical service is caused by the administrative costs represented by the systems for creating, reviewing and adjudicating health care provider payment requests. Such payment requests typically include bills for procedures performed and supplies given to patients. Currently, the systems for reviewing and adjudicating payment requests represent additional health care transaction costs that directly reduce the efficiency of the health care system and increases the cost of the health care delivered.
A need exists to reducing the magnitude of transaction costs involved in reviewing and adjudicating payment requests that would have the effect of reducing the rate of increase of health care costs.
A need exists for streamlining payment request review and adjudication that would also positively increase the portion of the health care dollar that is spent on treatment rather than administration.
A need exists to reduce the traditionally high cost of health care administration, including the review and adjudication of payment requests which results from health care service providers having to act as xe2x80x9cbanksxe2x80x9d or xe2x80x9ccredit sourcesxe2x80x9d for patients.
A need exists to facilitate the understanding of the contractual obligations between the service provider and the insured. Often, there are many different contractual arrangements between different patients, insurers, and health care providers. The amount of authorized payment may vary by the service or procedure, by the particular contractual arrangement with each health care provider, by the contractual arrangements between the insurer and the patient regarding the allocation of payment for treatment, and by what is considered consistent with current medical practice.
During recent years, the process of creating, reviewing, and adjudicating payment requests from health care providers has become increasingly automated. For example, there exist claims processing systems whereby technicians at health care providers"" offices electronically create and submit medical insurance claims to a central processing system. The technicians include information identifying the physician, patient, medical service, insurer, and other data with the medical insurance claim. The central processing system verifies that the physician, patient, and insurer are participants in the claims processing systems. If so, the central processing system converts the medical insurance claim into the appropriate format of the specified insurer, and the claim is then forwarded to the insurer. Upon adjudication and approval of the insurance claims, the insurer initiates a check to the provider. In effect, such systems bypass the use of the mail for delivery of insurance claims. However, there is no known system for accelerated payment of funds within only a day or two of the claims presentation.
In partially automated systems, such as that described in the foregoing example, the technician can submit a claim via electronic mail on the Internet or by other electronic means. To do so, the technician establishes communication with an Internet service provider or another wide area network. While communication is maintained, the technician sends the insurance claim to a recipient and then either discontinues communication or performs other activities while communication is established. Using such conventional systems, personnel at the health care provider""s office are unable to determine whether the submitted claim is in condition for payment and do not receive any indication, while communication is maintained, whether the claim will be paid.
Because of the large number of insurers and insurance plans, the amount of the co-payment can vary from patient to patient and from visit to visit. Moreover, when a patient is not covered for a certain treatment, the patient may be liable for the entire amount of the health care services. It is sometimes difficult for technicians at the offices of the health care provider to determine that amount of any co-payment or any other amount due from the patient, such as a deductible that must be collected while the patient remains at the offices after a medical visit. Once the patient leaves the office, the expense of collecting amounts owed by patients increases and the likelihood of being paid decreases. Conventional insurance claim submission systems have not been capable of efficiently and immediately informing technicians at the offices of a health care provider of amounts owed by patients, particularly when the amount is not a fixed dollar amount. A need has been desired, particularly by patients (insured) and health care providers for a solution to this dilemma.
Other methods and apparatus exist to attempt to streamline the insurance claim payment process, such as the method disclosed in Gamble U.S. Pat. No. 6,163,770. This patent reveals using a digital electrical apparatus to generate output for insurance documentation for a first insurance policy having a first risk and claims while revealing a concurrent second insurance policy for a second risk, wherein the second risk is different from the first. The processor of this method is connected to a memory device for storing and retrieving operations including machine-readable signals in the memory device, to an input device for receiving input data and converting the input data into input electrical data, to a visual display unit for converting output electrical data into output having a visual presentation, to a printer for converting the output electrical data into printed documentation, wherein the processor is programmed to control the apparatus to receive the input data and to produce the output data by steps including: inputting actuarial assumptions defining the first insurance policy; and computing a value of a specific financial attribute of the first insurance policy; the method further including the step of inserting the value of the financial attribute in the first insurance policy and other printed documentation related to the first insurance policy.
In view of the foregoing, there is a need for more a fully automated claims processing system that have the ability to have an accelerated pay schedule and an ability to reduce the uncertainty as to whether a claim to be submitted is likely to be paid or rejected.
Further, security is an issue of paramount importance in electronic communication. The card containing many elements personal and private information must be secure from all types of intrusion by unwarranted attempts to access. Only the owner of the card can give permission to read the card and establish the communication links to the owner""s private files at the insurer or any other location where information may reside. This activity must be incompliance with all applicable privacy laws and the card and its security must have the ability to change along with laws should a change occur. There are other medical laws that also must be complied with in example HIPAA (sp) and others of the like are federal compliance requirements. The card will help facilitate that compliance. Again the need for security is paramount.
The present invention has been developed to provide an accelerated claims processing system that would more easily allow health care providers to know what patient and treatment information must accompany insurance claims, whether or not a patient is eligible for accelerated fee payment, and to obtain funds quickly against rendered services from insurance companies. The present invention also includes various elements to provide security for the user.
The invention relates to a method for accelerating the provision of funds to a service provider from medical insurance using a smart card, comprising the steps of: obtaining medical insurance coverage from an insurer for a person; creating a smart card for the person, wherein the smart card comprises: information about medical insurance coverage for the person and a personal identification code.
Next, the smart card is used to determine if the person is eligible for accelerated provision of funds from the insurer to a service provider for medical services based on medical insurance coverage.
The smart card is used to determine if a medical service is preauthorized by the insurer for the person.
The smart card is used to determine if a service provider is preauthorized by the insurer to perform a medical service. Once these determinations are made, the smart card facilitates a first transmission from the service provider to the insurer. The first transmission can include information relative to medical service costs, information on the medical services provided to the insured; and an acknowledgement that the medical service has been rendered from the service provider to the person.
The smart card facilitates the receipt of a second transmission from the insurer to the service provider. The second transmission preferably comprises the amount of payment required by the person based on the insurance coverage. In addition, the smart card facilitates a third transmission to the insurer from the service provider. This third transmission comprises an acknowledgement that the amount of payment required by the person is based on the insurance coverage, such as the co-payment or the deductible amount. On approximately the same day that the third transmission is received by the insurer, funds are transmitted from the insurer to the service provider for the medical service provided to the person.